Gold's Next Move May Be Higher as Fed Hawkishness Peaks

Aakash Doshi, Head of Gold Strategy at State Street Asset Management, believes gold's next $1,000 move will be higher. According to him, market expectations surrounding the Federal Reserve's tightening bias appear overly aggressive. The markets have already done a lot of the Fed's work by moving real rates higher.

Doshi points out that long-term real yields are trading near historic highs at around 2.4%, near their highest level since October 2023. Despite this, gold continues to find support around $4,000 an ounce, with monetary policy expectations having reached peak hawkishness ahead of the central bank's next decision.

Doshi reiterated his updated base-case forecast for gold prices to trade between $4,750 and $5,500 an ounce over the next six to nine months. He also mentioned that gold could push to $5,000 an ounce within the first half of next year if there is a shift in rate expectations.